Compromise reached over social security reform

22 September 2005

BRUSSELS — The federal government has reached a compromise over its reform of the social security and pensions system, delaying final decisions until 11 October.

The Liberal and Socialist factions reached an agreement over the reform plan on Tuesday night and presented the proposals to unions and employers on Wednesday.

Unions and lawyers will now consult with their members and will re-enter discussions with the government on 27 September, newspaper ‘De Standaard’ reported on Thursday.

However, there is only a small chance that the government and its social partners will reach an agreement in the short-term. Both unions and employers have claimed the government’s plans are “vague”.

Not to be thwarted, the coalition federal government warned on Wednesday it will simply impose its will if negotiations with unions and employers breakdown.

Prime Minister Guy Verhofstadt will present the final measures in his policy statement on 11 October to coincide with the start of the new parliamentary year.

Social reform has been on the political agenda in Belgium for several months. In order to finance the social security system, more people need to work and, especially, work longer.

The main points of the government’s proposals have been drawn up, but the reform agenda remains brief in several crucial areas.

“We had to be clear enough to make it clear to the social partners what direction we wanted to go. At the same time, there must be enough margin to negotiate,” Employment Minister Freya van den Bossche said.

The policy note includes three main points: youth unemployment, retention of older workers and a new social contract with a strong social security system.

In terms of company restructuring, the government said early retirement must be the last option. The main focus should be in finding a new job, newspaper ‘De Tijd’ reported.

The government also wants to stimulate workers to work longer. A pension bonus will be set up for those who work past the age of 60 and will be boosted from the age of 62 also.

To discourage workers from bowing out of the workforce, the government intends to gradually raise the age requirements for early retirement.

Subject: Belgian news